‘Rent-A-Robot’ Is A Game Changer For Manufacturing – There is relatively little risk associated with renting robots—and the underlying technology has made important strides in recent years.
The floor of the chemical factory in Northeast Ohio has looked about the same for decades. Like soldiers in formation, containers come off the assembly line—ranging from little bottles to 5-gallon carboys—and workers transfer them into carts and boxes as fast as humanly possible.
It’s monotonous work at best, and it can be backbreaking when 40-pound jugs are rolling off the line. But soon, a new team member is primed to shake things up—and, hopefully, make things better.
That team member is a collaborative robot, or cobot, designed to enable the human workers to take on higher-value tasks. For years, cobots have been shown to make manufacturing processes faster and more efficient, but research shows that fewer than 10% of manufacturers use them. Among those not using cobots was the chemical company mentioned above, which wasn’t initially inclined to bet big on new technology when the status quo was largely good enough. That’s why a “rent-a-robot” model—which is gaining steam across the country—made so much sense.
“Given today’s increasingly tight labor market, more manufacturers should explore these models,” said Mike O’Donnell, my colleague and vice president at MAGNET, who worked with the chemical company noted above. “As the industrial ecosystem adjusts to the labor crunch, companies placing orders will seek out manufacturers with human-robot integration as the best way to ramp up production.”
Beyond that, there is relatively little risk associated with renting robots—and the underlying technology has made important strides in recent years.
Why Renting Provides Flexibility
Over the years, the owners of the chemical company grew their business from a regional player in the Midwest to a national operation, with more than 200 employees and a loyal customer base. Revenue was good, but margins were getting tighter, and staffing was becoming more of a challenge.
To continue succeeding at a high level amid increasing global competition and a declining labor force, company leaders figured something needed to change. That’s what got them initially interested in robotics and automation and, eventually, the rent-a-robot model. Vendors, some backed by venture capital, lease robots to SMEs, install and maintain them and bill by the hour or month.
With no upfront investment, much of the financial risk is removed, with the potential for immediate savings by way of improved efficiency. Leasing provides flexibility—financially and operationally—that wouldn’t exist if manufacturers bought robots or spent time and money developing their own. The model also puts pressure on the lessor to make sure their products are performing on the factory floor. Companies can test out the latest technology without being married to it and send it back if it’s not meeting their expectations or goals. On the flip side, if things go really well there’s often a lease-to-buy option.
Technological Advancements Have Made Robots Smarter, Faster And Cheaper
Thanks to technology, robots have become easier to integrate onto factory floors, capable of more advanced tasks and less costly to produce—all of which support the viability of the burgeoning rent-a-robot trend.
A McKinsey study found that the average robot price has “fallen by half in real terms, and even further relative to labor costs” in the past few decades. At the same time, strides in software development, computing power and networking technologies have shrunk the cost of installing and maintaining such machines. For instance, new plug-and-play technologies can connect various components using simpler network wiring than ever. And automated sensors can help collect data for maintenance and aid in improvement and troubleshooting efforts.
What’s more, today’s robots—powered by machine vision, AI and deep reinforcement learning—offer manufacturers new capabilities that can drive efficiency and further lower costs. Autonomous guided vehicles (AGVs) can now coordinate to move materials—like those on the chemical factory’s assembly line—from one location to another, ensuring that each machine is assigned to the right trip, doesn’t collide with other machines and remains charged throughout.
Helping SMEs Overcome Their Concerns
Some critics might point to so-called robot graveyards—i.e., collections of machines that have failed to pay dividends in the past that are now gathering dust on factory floors. That’s wrongheaded given how far the technology has come and the obvious benefits of renting. But leasing robots—and getting them to work for you—isn’t without challenges, including how to pay for the technology.
Of course, it’s not just about money. The leaders of the chemical company mentioned above, for example, had a multistate operation to run—orders to fill, people to hire, potential customers to host, reports to complete and plenty of troubles to shoot without creating new ones. They simply didn’t have time to develop their own robot systems or explore options of getting them from an outside vendor. My organization, one of many regional Manufacturing Extension Partnerships across the country, helped them find vendors, made introductions and even ironed out deal terms.
“It’s important for organizations like ours to serve this role and for companies to seek out this kind of assistance,” O’Donnell said. “It can be daunting to take the first step if you’re a company that has done things the same way—and succeeded—for years or decades. So working with a third party you can trust to fill in some blanks can really make a difference.”
These first rent-a-robot deals might be relatively modest—often just one robot to start. But they can be an important first step toward increasing efficiency and competitiveness in the short term and building confidence in automation as new technologies emerge. The technology should also be implemented in tandem with higher wages. Smart manufacturing roles pay an average of $12,000 more a year than more traditional manufacturing jobs.
Robots won’t and shouldn’t fully replace humans in factories, but they make operations more efficient, which in turn helps justify higher wages and training costs necessary to remain competitive. That’s important in combatting the turnover and job-hopping that is bedeviling most companies across the country—chief among them, manufacturers.
For more insights visit our News & Events page.